Oireachtas Joint and Select Committees

Tuesday, 11 June 2019

Committee on Budgetary Oversight

Fiscal Assessment Report: Irish Fiscal Advisory Council

Mr. Sebastian Barnes:

On the Deputy's question on drugs, some of the new drugs are extremely expensive. This is one of the drivers of higher healthcare costs in Ireland and many other countries. What it underlines is the importance of having good medium-term forecasts and projections for what health spending will be. These forecasts should be based on a realistic assessment of what is driving health spending. That is partly population ageing but it is also things like the new drugs. One of the problems at the moment is that there does not seem to be a realistic baseline and that people do not stick to it. Having a more medium-term approach would be very helpful. For example, the UK has, for the first time, a long-term, five-year plan which envisages quite rapid rises in health spending but those increases are more or less in line with the historical experience of recent years. In principle, therefore, they should provide the headroom to deal, for example, with new drugs, an ageing population, the increasingly complex mix of pathologies and other issues. That shows it would be very helpful if planning was done on that basis as everyone would know where they were starting from.